11 days after whistblower Captain LePage comes forward with allegations of timecard abuse within the Salina Fire Department, City staff seems to scramble a report together to present to City Commissioners at weekly meeting.
City Commissioners heard an update on the Salina Fire Department forensic audit report, at this week's city Commission meeting.
City Manager Mike Schrage made it clear that city officials are trying to be as transparent as possible.
Schrage then made a point to say that the city of Salina has come forward with even more information that other cities have, given similar situations.
Salina city government employees have a due process system that is made clear within the employee handbook, which is given to each new city employee upon hire.
The city manager is the final arbitrator of matters such as this, and will remain at arms length until this matter subsides.
Schrage began by saying that in the beginning, concern was identified, somewhat simultaneously while city officials were looking at it from a CPI standpoint.
A staff person in the fire department confirmed the concerns, without this staff person being named.
An initial staff investigation was started to gather data. It was recognized that a 3rd party needed to be brought in because of the complexity of the data, and to remain objective.
3rd party sources were interviewed before making the choice to bring in BKD, who was ultimately hired, and completed the forensic report which is available on the City's website.
We have a link for you here.
http://weblink.salina.org/WebLink/DocView.aspx?id=475650&dbid=0&repo=Salina
As to why the employees in question were not immediately placed on administrative leave, Michael Schrage said that placing a City employee on administrative leave relates to events that are more attributable to a particular employee. The example given was an officer involved shooting. Meaning that, if a city police officer was involved in a shooting, that officer would be placed on administrative leave while the investigation was ongoing, and a decision was ultimately made. Or, some other observed violation.
Michael Schrage then commented that in this case, they knew a detailed investigation would be necessary, but that city officials did not want to rush to judgment in making a decision regarding the employees in question. He stated that mitigating factors such as past practices or directives could be clouding the issue.
From a financial standpoint, City Manager Schrage stated that if these employees were placed on leave, the employee handbook states that it would be a paid situation. Therefore, bringing in more employees to cover the empty shifts would have created similar impacts.
In addition, any employee placed on leave would have created a detrimental situation to the station in which the employee belongs to.
Julia Mast is the BKD representative, who created the forensic report of which the City Commissioners were given on Monday night.
BKD was engaged through the law office of Clark, Mize & Linville.
The report was completed in phases. The year 2019 was looked at first, by way of each individual fire fighter. As noted, there were over 90 (later said to be 99) on staff in that given year. It was not voiced if this year was chosen at random or for a specific reason, but Mast stated that it gave BKD a clean start to look at all firefighters evenly. They were looking for unusual activity, with no preconceived notions.
It was also important to understand the handbook policies. This means that if something is stated in the policy book in clear print, and auditors still found it to be happening, that would raise a red flag. However, if something is happening that isn't clearly stated within the policy book, then that means something totally different.
Detailed time analysis was completed next.
Schedule activity was compared between payroll system, data tracker, and the outlook calendar. For instance, if an employee was shown to be on vacation in one area, but the other two areas showed that employee as still working, it was deduced that the vacation time was not deducted from their vacation accrual.
Julia Mast said that it looked like everything was recorded appropriately, so they moved on.
The analysis on administrative days found that 260 shifts appeared to have been taken that didn't satisfy their payroll accrual that was expected. This was for the years 2014-2020.
Digital forensics were completed by a digital forensics lab in Kansas City, at the recommendation of BKD. Senior data scientists completed the analysis on emails for the years 2019-2020. The emails were provided by the City of Salina.
Digital forensic scientists completed analysis by key words and emotional tone detection, with the help of artificial intelligence.
It was identified that there were emails sent from the fire chiefs to the chiefs of staff to the accountants requesting that their time off be counted as administrative leave, instead of vacation or sick leave, or any of the listed combinations.
Interviews were also conducted, of which everyone who was requested freely participated.
A key takeaway, according to Julia Mast, was that administrative time would not be needed if the departments had a Deputy Chief to help relieve their workload.
Some Chiefs of Staff noted that in requesting time off, they were not aware of the proper way to do so. Even with an approval process stated, some received explicit permission while others just took it, not seeking approval.
Mast also noted that the amount of administrative leave being taken by Chiefs of Staff is affecting the moral within each station.
It was also noted, that in the opinion of Julia Mast, that the Chiefs of Staff might be better off if they were paid hourly. This would allow for any administrative time needed, outside of their normal firefighting duties, to be paid hourly as opposed to the salary that they currently receive.
As far as the financial impact that this has had on the City, the years 2014-2020 were looked at.
For administrative time being classified as vacation, the amount was $75,373.73.
The value of the financial impact on sick time fell on 24 shifts. This means that sick time was taken, but it was not deducted from their sick time accrual. The amount in this category was $18,246.12.
Julia Mast thinks that there is a pattern of this behavior, from before May 2007. That is the point in time when the administrative leave policy notice was sent out, but Mast says it appears to have been happening in the City of Salina for quite some time.
She goes on to say that the City Managers Office did not appear to have received a copy of the administrative leave policy memo that was sent out, and that she does not think it would have been approved had they seen it due to the leaving out of certain policies. This memo was also poorly circulated between chiefs of staff.
City Manager Mike Schrage then spoke on next steps. He said that as the final arbitrator for this situation, he has delegated this to the Deputy Manager Jacob Wood and HR Director Natalie Fischer, who have steered it thus far. They now want to take the specifics of the investigation and begin looking at each of them in a personal matter, continuing with due process.
Commissioner Davis asked a key question: "Is there any evidence in all this information that would suggest this changed from a misguided practice to what could be a deliberate attempt to change the classification of leave?"
Julie Mast stated that from the analysis, there was never real secrecy until 2020, when things were changed within the accounting system and email practices.
Davis also asked what role accounting had in this. The City Attorney requested that Mast not answer.
An interesting dialog unfolded when Commissioner Peck had his turn.
Peck said, "I am curious, you made some personal evaluations on what your opinion was throughout the evaluation. Several times in here it talked about city staff, let's say, not wanting to know about comp time, or quotes turning in that direction. There seems to be some confusion as to whether that was to be interpreted as to 'I'm going to turn a blind eye towards comp time,' or 'keep doing what you're doing and I don't want to hear about it.' "
This question was directed toward Julia Mast. Peck went on to say,
"I'm curious as to what your personal opinion is..."
City Deputy Manager Jacob Wood spoke up then.
"Commissioner, I don't think Ms Mast was engaged to make those kind of determinations related to people's intent or mindset relating to comp time."
Commissioner Peck then asked, "You hired them, correct?"
Deputy City Manager confirmed that question in the positive.
Peck moved on, "The report is full of those types of evaluations, just so we're clear."
In a stunning confirmation, Mayor Hodges said she saw at least two or three instances where Ms Mast personal opinion was injected into the report.
Indeed, with Ms Mast talking about the employees morale, among other things in the report, asking for her personal opinion in a broad manner such as this should have been no problem.
Commissioner Peck conceded to personal protocol, but not before saying that this governing body cannot pick and choose which personal opinion they look at, and which ones they don't want to hear right now.
Ms Mast said that this is a factual report. "Nothing in this report was not said to me. Morale was a theme, not only amongst the chiefs of staff, but by other... okay, I'll stop there."
She was apparently motioned to stop by someone off screen. All that could be heard at this moment was a microphone tap.
Mayor Hodges noted that the emails Ms Mast received were limited to only those of firefighters. It did not expand to other agencies within the city government.
Hodges also noted that the administrative leave issue seemed to stop in February 2020. The staff provided timeline noted that on February 10, senior staff had a meeting. It was immediately after this meeting, from what Hodges deduced from Ms Mast' report, that the apparent misuse of administrative time ceased to exist.
The personnel manual was then brought up by Mayor Hodges.
Natalie Fischer, HR Director, stated that when discipline is imposed, the most a city department head can implement is a five day suspension. Anything beyond that is in the jurisdiction of the City manager, in this case Michael Schrage, in the form of a hearing. This would include dismissal or demotion.
When asked who initiates such a hearing, Fischer said that is normally initiated by the department head.
Commissioner Davis asked if city employees are required to sign a paper saying they have received and read the employee handbook. He was told they only sign upon receiving the handbook.
The question that is on everyone's mind, however, is the timeline.
Commissioner Peck got that ball rolling.
Schrage said that in "early spring" it was seen that help would be needed from outside resources.
Mayor Hodges stated, "It looks like we had an executive session on March 2, 2020. Based on an email that I sent the following day to Mr Schrage, it would appear that that's when the Commission became aware of the discussion to go with an outside audit entity."
Remember that Commissioner Peck was not a part of this governing body until recently, when he replaced Commissioner Ron Franz.
Peck went on. "I'm trying to understand how it took from October 2019 until October 27, 2020 before there's an initial kickoff with BKD."
City Manager Schrage said he does not dispute that timeline. He explained that six different segments dragged this process out, including vetting proper digitial anylists, finding a proper lawyer, and negotiating contracts.
It can also be noted that Mayor Hodges was a Commissioner at this time in 2020. Who was the mayor of Salina?
Mike Hoppock.
He stated that they were dealing with unusual circumstances. It can be assumed that they were dealing with COVID and "keeping the city whole," as he put it, while COVID was never directly mentioned until later.
Mayor Hodges spoke up. "To some extent I agree with that but I'm still having trouble with the whole timeline thing, and when staff knew about the problem. We received an email from the whistleblower, where he made the assertion, that he had informed HR in July 2018 and he contacted HR again. I guess my question is, was the CPI project to examine fire department overtime in response to the 2018 concerns that Mr LePage brought to city staff?"
City Manager Mike Schrage defended the CPI project. "To my knowledge it wasn't. The CPI effort was to look at overtime in multiple departments that got our attention. I can't speak to CPI in comparison to July 2018."
Peck noted "That's a good point, because that would add one more year to this. Can anyone clarify that this is when City staff was informed about this?"
Natalie Fischer stated that her timeline did not match up with the one just noted, but that hers went further into the year.
Mayor Hodges still wanted to know, in spite of 2020 giving the commissioners the challenge of a pandemic, why city staff had 5-6 months between October 2019 and March 2020 to bring this to light, and that there was no sense of urgency to do so.
City Manager Schrage did not disagree with that. He did say that the time was spent validating the complaint, and deciding how they wanted to move forward.
Natalie Fischer stated that an upgrade is needed in timecard keeping capabilities, and that a time is coming very soon for Commissioners to think about how to proceed in that regard.
Mayor Hodges then asked the next question.
"My question is what your responsibility is both as attorneys and council to the city commission and whether or not as such, do you have any kind of fiduciary duty to report something to the appropriate authorities if you have knowledge of a suspected crime? Is there any duty or obligation on your part to report that to the appropriate agency? Is there a specific department in our government that investigates potential municipal fraud?"
After a long pause, City Deputy Manager Jacob Wood took the field.
"There are very limited circumstances in which we may report suspected criminal activity. In terms of the investigation of potential criminal fraud, there are state agencies that do that, but at the same time I would note there are very few cases which it's a completely one sided story."
Mayor Hodges then asked if, as the governing body, if they upheld their oath.
City Attorney Greg Bengston took that question.
"I certainly believe so."
Mayor Hodges concerns on the timeline, however, did not cease.
Below is a 90-second snippet of this time.
Aside from questioning city staff on the accuracy of the time line presented to Commissioners, you will hear Mayor Hodges mention the name of Chief Royce.
She mentions staff met with Chief Royce "on February 10 and instructed him not to alert staff to the investigation."
If the whistleblower didn't bring this to attention, where would this investigation be?
Good question, Mayor Hodges.
There seems to be no urgency on the part of City staff to alert anyone to this matter, situation, issue... whatever you want to call it.
Mayor Hodges finished by saying that the issue could still be going on, and there's no way to catch it until the software system is upgraded.
It was now that the public was able to speak.
John Blanchard, a former city commissioner, took the mic. He held office from April 2013 to January 2018. As he stated, "This was going on under my watch. Although I knew nothing about it you guys do now."
Blanchard called Captain LePage a very courageous whistleblower.
"It discourages me that the only person who has suffered anything in this entire process has been Captain LePage."
Moments later, Mayor Hodges gave a simple, "And thank you to Mr LePage, too."
The last thing John Blanchard mentioned is that our city is full of good firefighters.
Yes, the good ones are there, and situations like this bring down the moral within.
Dalton McDowell recommended getting a second opinion on all of this, to take it out of Salina, and to get a different attorney involved.
Joe Hay is also a former city commissioner, who served for 2 years. He was very disappointed that no commissioners who served with him were involved or told about what was going on. "They should have let us know, even in executive session, we should have known. Anything to do with tax payer money should have been on the table."
Chad Farber wants to know where this goes from here. Is it in other departments?
The problem seems largely confined to exempt employees, but it makes all departments look bad, according to Mayor Hodges.
Commissioner Peck asked the legal counsel at what point they were told there was an issue.
City Attorney Greg Bengtson answered by saying, "Off the cuff, I cannot respond accurately to that question, Commissioner."
Peck retorted, "That's something I'd like to know."
Mayor Hodges then brought up, as she was flipping through the report, the need of a safe deposit box. Security concerns in the City county building? A chain of control over the data?
City Manager Mike Schrage had an answer.
"We didn't know what we had in the way of data, and we were trying to analyze that data and manipulate it in terms of doing comparisons. I wanted unaltered records so if we were relying on it as evidence, we could say this set was unaltered from the get-go."
After 2 hours and 50 minutes of hearing report data, digital forensic evidence, and time lines that just don't match up, the City Commission and the tax paying public were left with more questions than answers.
What we do know is that there are discrepancies in the time cards of fire chiefs versus what they were paid and what went to the accounting system. It is also believed that these discrepancies go far beyond the reach of the time frame for which the digital audit was conducted.
Questions that remain without answers are many. When did city staff know? When did the City Commission find out? Does this go beyond the fire department into other city departments? Was it intentional or due to ancient software in need of upgrading?
Why did it take the courageous actions of Captain LePage as a whistleblower to bring this to the attention of the public?
While it is not yet known whether this issue will be on the agenda for next week's Commission meeting, the public is welcome to talk about anything not on the agenda during the time known as Citizen Forum.
The meeting will begin at 4pm on Monday, August 23.